A General Theorem on the Comparative Statics of Changes in Risk

In this paper, the concept of absolutely riskier than is introduced to generalize Gollier's (Journal of Economic Theory, 66, 522–535) necessary and sufficient conditions for the comparative statics of a change in risk for risk averters. The restrictive assumption that the payoff function is monotonic in the risk is relaxed. The policymaker's choice problem, the newsboy problem, and a farmer's example are used to illustrate how easily the monotonicity assumption is violated. Finally, some important properties of the concept of absolutely riskier than, such as its relation with the concept of second-order stochastic dominance, are illustrated using the farmer's example.     

NEA presidential address, 1992: Policy issues in the postsecondary education of African Americans

Few goods and services are as important to socioeconomic outcomes as education. Participation rates of African Americans in postsecondary education are much lower than those for whites. The disparities in college attendance and graduation rates have potentially grave consequences for African Americans and for the larger society. This article addresses some of the policy influences that determine educational outcomes for this population subgroup and raises some of the issues that should be addressed if proportionate participation rates are to be generated.     

The Day the United States Defaulted on Treasury Bills

Because of severe technical difficulties, the U.S. government was unable to repay investors in Treasury bills (T-bills) in late April through early May, 1979. This incident led to a 60 basis point increase in T-bill rates at the initial occurrence of the default. Unlike other information effects of that era, such as Henry Kaufman's predictions or Paul Volcker's “Saturday night special,” this increase in rates was not offset by a subsequent decrease in rates after the Treasury cured the default. The default apparently warned investors that Treasury issues were not completely riskless, which translates into a $12 billion annual increase in federal interest payments as a result of the 60 basis point permanent increase in interest rates.     

Input price uncertainty and the production-location decision : A Critique and Synthesis

This paper compares the recent work of Hsu and Mai with other recently published and soon to be published work incorporating input price uncertainty in production-location problems. It also clarifies, strengthens, and corrects some results contained in recently published papers.     

Market reaction to the formation of one-bank holding companies

This study examines the question of whether or not the formation of one-bank holding companies is of such importance as to materially affect the return generating process for the associated common stock issues. As such this study attempts to provide the security analyst with answers as to how best to define the parameters of the distribution of firm returns, that is, which past observations are relevant to the firm's present return generating mechanism. The results of the tests performed indicate that the formation of a one-bank holding company generally does not have a significant impact on the return generating mechanism for the underlying stock of the affected bank. Thus, the market does not appear to attach any real significance to this particular shift in organizational form by the commercial banks studies.     

Market structure and minority presence: Black-owned firms in manufacturing

This study uses a market structure framework to analyze the presence of black-owned businesses in manufacturing sectors of the U.S. economy in 1972. Tobit analysis reveals that black-owned firms tend to be concentrated in those industries with a relatively large small-business presence. High advertising expenditures are a significant barrier to black presence in a given industry. The amount of government purchases from an industry is found to have no significant relationship to black presence.